New York (CNN Business) – Bitcoin prices continue to skyrocket and the cryptocurrency is now just a short distance from its all-time high reached in December 2017.
Bitcoin briefly surged above $ 18,000 on Wednesday, having passed milestones of $ 15,000, $ 16,000 and $ 17,000 in recent days. The bitcoin record is just shy of $ 20,000. The total value of all Bitcoins in circulation is now more than $ 300 billion, also close to an all-time high.
The cryptocurrency, whose value has more than doubled this year, has gained momentum lately for a variety of reasons.
Bitcoin, like gold
Bitcoin, like gold, has benefited from a weaker dollar. Investors increasingly see bitcoin as a viable alternative to government-backed paper currencies.
The dollar could remain stagnant for a while, especially as most market experts expect the Federal Reserve to keep interest rates at zero for the foreseeable future.
“There is a lot of stimulus happening globally,” said Rich Rosenblum of GSR Markets, a crypto trading company. He noted that the devaluation of the dollar and other currencies could boost bitcoin even further.
Notable investors, such as hedge fund managers Stanley Druckenmiller and Paul Tudor Jones, have lately adopted bitcoin as an investment. Financial technology giants Square and PayPal endorse it as a viable form of payment.
“This bull run is different from 2017. We are seeing adoption by major players,” Alex Adelman, CEO and co-founder of Lolli, a bitcoin rewards company, said in an email to CNN Business. “Everyone is betting big on bitcoin as a safeguard against inflation, uncertainty and the turmoil of 2020.”
Bitcoin promoter Mike Novogratz, who runs crypto asset firm Galaxy Digital, told CNBC on Wednesday that he believes bitcoin prices could climb as high as $ 60,000 next year. And a Citi strategist wrote in a report this week that bitcoin was likely to skyrocket to $ 318,000 by the end of 2021.
Still, bitcoin is not for the faint of heart.
The price has often skyrocketed and dropped, sometimes within hours or minutes, and is subject to mini flash failure. Prices also plummeted in March, along with just about everything else, when the coronavirus crippled the US economy.
Some experts are wondering if bitcoin will have trouble getting much higher from here given how explosive the current rally has been.
The $ 20,000 level could be a “psychological barrier,” George McDonaugh, managing director and co-founder of blockchain and cryptocurrency investment firm KR1, said in an email to CNN Business.
McDonaugh said that some longtime bitcoin promoters, people known in the crypto community as HODLers (which may be a misspelling or the acronym for “Hold On for Dear Life” or “hold on for dear life” depending on who you ask) they can finally go for some profit and sell if bitcoin surpasses the $ 20K milestone.
“Be careful … as we’ve seen so many times in the past, bitcoin may surprise you,” McDonaugh said.
The big bitcoin explosion has also benefited a number of publicly traded companies involved in the crypto world.
Shares in Riot Blockchain, Marathon Patent Group, and Overstock, the online retailer that owns blockchain investor Medici Ventures and cryptocurrency platform tZero, have risen dramatically this month alongside bitcoin.